FLS HOLDINGS, INC. REPORTS RESULTS
FLS HOLDINGS, INC. REPORTS RESULTS TAMPA, Fla., Nov. 1 /PRNewswire/ -- FLS Holdings, Inc.
(NASDAQ-NMS: FLSHP), parent company of Florida Steel Corporation, reported consolidated net sales for the year ended Sept. 30, 1991, of $463.2 million and net loss of $8.9 million compared with net sales of $534.5 million and net income of $8.0 million for the year ended Sept. 30, 1990. Consolidated net sales for the fourth quarter ended Sept. 30, 1991, were $124.1 million and the net loss for the quarter was $1.9 million. Net sales for the quarter ended Sept. 30, 1990, were $135.4 million and the net loss for the same quarter was $804,000.
Net sales for the fiscal year ended Sept. 30, 1991, were lower vs. a year ago as a result of fewer tons of steel products shipped and lower average unit selling prices. Finished tons shipped and average unit selling prices in the fourth quarter ended Sept. 30, 1991, were also lower than the comparable quarter in 1990. Weak demand, competitive pricing pressures, and greater than anticipated start-up costs of the new Tampa electric furnace were the primary causes for the lower operating results. The higher start-up costs of the electric furnace were primarily the result of bottom refractory problems. However, recent modifications to the design have resulted in improved production and a substantial reduction in downtime. As a result of lower operating earnings, the company failed to maintain the consolidated interest expense coverage ratio at Sept. 30, 1991, as required under the company's senior term loan and revolving credit agreement (the "agreement"). In addition to the interest coverage ratio, the agreement includes several other financial tests. The company believes that it may not meet one or more of these requirements over the next several months. The company, however, has obtained from the bank lenders under the agreement a standstill agreement that provides that until Nov. 30, 1991, any failure to maintain any of the financial tests would not constitute an event of default for any purpose under the agreement, including for purposes of permitting any exercise of rights or remedies. The company is current on all of its obligations and expects to remain current in the near term. The company is continuing to evaluate various alternatives to refinance or restructure its borrowings under the agreement, although no decision has been made at the present time to enter into any agreement or understanding regarding such a refinancing or restructuring, or with respect to the terms thereof. There can be no assurance that any such refinancing or restructuring will be consummated, or as to the terms of any such refinancing or restructuring. FLS HOLDINGS INC. YEAR ENDED SEPT. 30, THREE MONTHS ENDED SEPT. 30, 1991 1990 1991 1990 Net Sales $463,164,566 $534,497,201 $124,088,267 $135,424,092 Income from Operations$ 25,566,438 $ 54,247,164 $ 7,058,324 $ 8,698,064 Interest and Amortization of Deferred Financing Costs $ 38,287,627 $ 39,792,526 $ 9,777,371 $ 9,637,276 Income (Loss) Before Income Taxes $(12,721,189) $14,454,638 $ (2,719,047) (939,212) Net Income (Loss) $ (8,932,189) $ 8,032,638 $ (1,946,047) (804,212) Finished Tons Shipped 1,249,396 1,329,005 343,741 349,222 Depreciation 15,048,624 $14,497,706 $ 3,902,552 $ 3,657,481 EBITDA (A) $43,284,690 $71,414,498 $11,628,283 $13,022,952 (A)-- Earnings before interest, taxes, depreciation and amortization. FLS Holdings Inc., a Delaware holding company, owns 100 percent of the outstanding common stock of Florida Steel Corporation. Florida Steel Corporation is the sole investment and source for income of FLS Holdings Inc. Florida Steel Corporation is a Tampa-based steelmaker consisting of five electric steel mills, 15 reinforcing steel fabricating plants, two reinforcing steel epoxy coating facilities, a post-tension facility, a hollow metal door and hardware operation, a railroad track spike operation, a subsidiary producing welded wire fabric and nails, and a transportation division. -0- 11/1/91 /CONTACT: Alfred D. Gres, chief financial officer of Florida Steel Corporation, 813-251-8811/ (FLSHP) CO: FLS Holdings Inc.; Florida Steel Corporation ST: Florida IN: MNG SU: ERN MR-AW -- FL005 -- 0207 11/01/91 12:05 EST
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|Date:||Nov 1, 1991|
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